Sunday, September 20, 2009

Markets Continue to Dazzle Doubters

Markets turned in another stunning performance this past week with REITs leading the way. Every industry sector gained with the exception of Healthcare, based on sample ETF data. Bonds and gold, traditional safe havens, also lagged.

Even the Dollar took a pause from it's massive drop this past week.


Yup, you guessed it. SIZE. Size continues to fall. Since this is a statistical indicator, I cannot doubt it. It is not some data point that might be interpretted this way or that. It is a clear sign that momentum, even though it appears to be so strong in the market movement, is really losing steam. Perhaps it will ramp up next week if we have some kind of huge move. But I'm not going to bite except for play positions. I've earned my target returns for the year in both stocks and futures. I've learned that the old axiom is true. Bulls make money, Bears make money but Pigs get slaughtered.

If the market movement is getting you excited and you are funneling in more money, it's quite possible that there is still some more upside left. But is it worth the risk?

On the other hand, I'm tempted to throw in a couple hundred thousand, take my probable 5% return next week, and quit my day job for the rest of the year.


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